Executive Briefings

Will Recovery Bring a Different Kind of Pain?

By: Jean V. Murphy, SupplyChainBrain 06.24.2009

I guess no one needed any additional proof that 2008 was a dismal year, but I still found the statistic-filled 2008 State of Logistics report interesting. Sponsored by CSCMP and compiled by Roslyn Wilson, this annual report, released June 17 and available to members at www.cscmp.org, is chock full of numbers documenting recession-driven declines in freight volumes and industry revenue -- declines that pushed business logistics costs down $49bn over 2007, to only 9.4 percent of GDP. Wilson thinks it likely that a 'U' shaped recovery will not really take hold until 2010, but when it does it will bring a different kind of pain. With 3,000 trucking companies out of business since last year and 7 percent of trucking capacity gone from the market, an upturn in business will create "immediate truck capacity problems," Wilson says. Clearly this is something companies need to be planning for now, if she is right.

Do you agree with this prognosis? If so, what steps do you think are needed to get ready for demand outpacing supply? Join the discussion!

I guess no one needed any additional proof that 2008 was a dismal year, but I still found the statistic-filled 2008 State of Logistics report interesting. Sponsored by CSCMP and compiled by Roslyn Wilson, this annual report, released June 17 and available to members at www.cscmp.org, is chock full of numbers documenting recession-driven declines in freight volumes and industry revenue -- declines that pushed business logistics costs down $49bn over 2007, to only 9.4 percent of GDP. Wilson thinks it likely that a 'U' shaped recovery will not really take hold until 2010, but when it does it will bring a different kind of pain. With 3,000 trucking companies out of business since last year and 7 percent of trucking capacity gone from the market, an upturn in business will create "immediate truck capacity problems," Wilson says. Clearly this is something companies need to be planning for now, if she is right.

Do you agree with this prognosis? If so, what steps do you think are needed to get ready for demand outpacing supply? Join the discussion!